STATEMENT

Saturday, August 30, 2014

In late May, Pratt & Whitney supplier surveillance discovered conflicting documentation that raised questions about the origin of raw material provided to a parts supplier. This raw material was used to manufacture some parts used in Pratt & Whitney and Pratt & Whitney Canada engines. Pratt & Whitney immediately reported its concern to the Defense Criminal Investigation Services, the Air Force Office of Special Investigations and the U.S. Attorney's Office. Pratt & Whitney Canada notified the Federal Aviation Administration and Transport Canada. Both companies also followed established customer notification processes, beginning with those impacted.

Soon after this issue was detected, P&W issued a Government Industry Data Exchange Program (GIDEP) alert, which notifies the industry and our peers about this supplier concern. P&W and P&WC have robust supplier surveillance processes in place, which is how we were able to detect this matter. We will continue to apply these processes to detect similar issues in the future. The safety of those who depend on our engines is always our top priority, and we are taking appropriate steps to ensure our products' integrity and quality. Pratt & Whitney is conducting a rigorous analysis of the material in question in accordance with our standard procedures. While the tested material may not meet every Pratt & Whitney material control standard, our engine designs have significant amounts of margin and, based on our engineering assessments, such material does not pose a risk to safety of flight.

Pratt & Whitney and Pratt & Whitney Canada are treating this matter very seriously. The sub-tier supplier, A&P Alloys, has been eliminated from our supply chain, and we are no longer accepting parts made from material provided by this company. Our robust sourcing strategy will help mitigate customer impact from this situation.

Pratt & Whitney is absolutely committed to safety, product quality and business ethics. We never compromise these values under any circumstance. Customers expect world-class quality from their dependable engines – it's our responsibility to deliver it.

Pratt & Whitney filed a lawsuit on August 29 against A&P in the United States District Court in Boston, Massachusetts.